PHOTO
- Capacity gaps fuel growing opportunity for branded hospitals and international healthcare operators
- Number of Saudi nationals aged 65 and over projected to more than double to 2.15 million by 2040
- 84% of Saudis say senior living facilities need to be integrated in real estate development plans
Riyadh: Healthcare infrastructure could offer a major opportunity for private investors and developers as Saudi Arabia looks to increase provision for its growing population, according to The Saudi Report from global property consultancy Knight Frank.
Driven by the government’s Vision 2030 initiative, Saudi Arabia is undergoing an unprecedented economic transformation that has seen US$ 1.3 trillion of real estate and infrastructure projects announced and US$ 196 billion in contracts awarded since 2016. In the next 5-10 years alone, Knight Frank estimates that more than 1 million new homes and over 7.9 million sqm of office space could be competed.
Despite this rapid development, healthcare output accounted for only 4.8% of the Kingdom’s GDP in 2023, compared to a global average of 5% to 12.5%. This lower output has historically been attributed to Saudi Arabia’s young population, which naturally requires less medical support. However, as this demographic begins to age over the next two decades, the Kingdom faces a significant infrastructure gap. In Riyadh, for instance, Knight Frank has identified a capacity gap of almost 15,300 hospital beds by 2040, based on global averages.
Dr Gireesh Kumar, Associate Partner - Healthcare Consultancy, MENA, said: “Saudi Arabia’s rising life expectancy—reaching 78.8 years in 2024—and a projected 2.4‑fold increase in the elderly population by 2040 are placing healthcare at the centre of the Kingdom’s long‑term development agenda. Although significant strides have been made in expanding healthcare capacity nationwide, the system still faces a structural gap in hospital bed availability. Current bed density stands at 2.0 beds per 1,000 people (excluding beds from other government sectors), below the global average of 2.9 beds per 1,000. Regional disparities also persist: Riyadh province and Jeddah city each have 1.8 beds per 1,000 people, while the Eastern Province performs slightly better at 2.2 beds per 1,000.”
Knight Frank’s analysis shows that 15-20% of acute care beds are occupied by long-term care (LTC) patients, highlighting the unmet demand for this segment of the patient population. Indeed, the Ministry of Investment has identified LTC as a national investment priority, while the Health Holding Company has announced plans to allocate dedicated LTC beds by converting lower-capacity hospitals into specialised LTC facilities.
Kumar added: “The investment potential for the long-term care (LTC) sector is significant: demand is expected to reach 12,000 LTC beds by 2030 and 24,400 by 2040. And with current occupancy already exceeding 90%, there is both an urgent need to expand LTC capacity and a growing opportunity for leading local healthcare providers and international healthcare operators to enter Saudi Arabia.”
REVERSING MEDICAL TOURISM
Historically, many Saudis preferred to travel abroad for medical treatment, driven by the perception that foreign hospitals offered higher standards of care and greater clinical expertise. This trend is reflected in Knight Frank’s analysis, which shows that 31% of Saudi nationals and 24% of Saudi-based expats have travelled abroad for treatment, rising to 49% for Saudi nationals on monthly incomes of SAR 50,000-70,000.
Faisal Durrani, Partner – Head of Research, MENA, explained: “Given the seemingly well-entrenched perception that the quality of medical facilities, medical practitioners, as well as the standard of treatment is better abroad, there is a clear opportunity to recapture some of this demand by bringing more internationally recognised branded healthcare operators to the Kingdom. With our research showing that almost half of Saudi nationals on incomes of over SAR 50,000 a month would readily travel internationally for elective or essential medical procedures, there is a strong potential for premium, specialist-driven healthcare developments in Saudi Arabia, especially in Riyadh and Jeddah, where affluent nationals and expats show high engagement with international medical services.
“Expanding access to top-tier specialty care, wellness facilities, and advanced diagnostics domestically could help retain high-spending patients and curb outbound medical travel, particularly among insured and high-income groups. This could be achieved through partnering with internally renowned medical brands and facilities”.
Knight Frank also points to government reforms which aim to reverse this trend by attracting trusted global healthcare brands to operate locally, encouraging patients to remain in the region for treatment.
Within Saudi, private hospitals are the preferred choice for elective procedures, selected by 47% of Saudi nationals and Saudi-based expats. Among higher-income Saudi nationals (SAR 70,000+ per month), the preference for private hospitals tops 60%, reflecting the prevalence of family insurance plans among this group.
Overall, 83% of Saudi nationals and expats are covered by health insurance, with 50% on family plans and 33% on single plans. Among Saudi nationals, coverage rises with income – those earning SAR 70,000+ per month have the highest coverage, with 54% on family plans and 40% on single plans.
Proximity also influences choice of healthcare facility within the Kingdom. Most Saudi nationals and Saudi-based expats prefer facilities within 5-10km (38%), or within 5km (25%). The more affluent generally expect high-quality facilities nearby, with 59% of Saudi nationals on a monthly salary of SAR 70,000-80,000 expecting to find a suitable medical facility located within 5km.
Kumar continued: “The combination of high insurance penetration, a clear preference for private healthcare among affluent households and travel distance expectations creates distinct investment opportunities. For high-income and expatriate-heavy neighbourhoods, there is scope to develop premium hospitals, day surgery centres and specialist clinics. For middle-income Saudi communities, there remains a gap in adequate supply of mid market healthcare facilities. Locating new healthcare developments within 5-10km of major residential and commercial clusters will address both accessibility and utilisation considerations.”
EMERGENCE OF THE SENIOR LIVING SECTOR
While still in its infancy in the Kingdom and the wider region, the importance of the senior living sector is expected to increase as life expectancies climb and senior citizens seek lifestyle-driven communities that blend healthcare access with comfort, wellness and social engagement.
Durrani explained: “Traditional care homes have yet to be widely embraced culturally, but our research shows increasing interest – particularly among affluent families – in alternative care models. These include integrated care systems rather than conventional “daycare”, where elderly residents can be cared for during the day, receive medical supervision and medication, and remain socially connected. Families expect such facilities to be embedded within residential communities, allowing families to visit easily and stay closely involved in their relatives’ daily care”.
This sentiment aligns with the Kingdom’s Quality of Life Programme 2023, which prioritises wellness and elderly care infrastructure in new urban communities. Complementing this, home-care services, already used by 43% of households, are gaining traction as part of the government’s broader shift toward decentralised, patient-centred models, supported by digital health platforms and licensed operators.
Support for integrated senior living facilities is particularly pronounced among Saudi nationals (85%) and households earning over SAR 80,000 per month (100%), reflecting the convergence of cultural values around family care with modern senior living solutions. Notably, 75% of Saudi-based expats are also aligned with this view, indicating a broad cross-demographic appetite for senior-focused amenities.
Amar Hussain, Associate Partner – Research, MENA, said: “While still a relatively nascent segment of the healthcare landscape in the Kingdom, we expect demand for senior living and associated medical facilities to grow rapidly as the population begins to age. Indeed, we forecast that the number of Saudi nationals aged 65 and over will more than double by 2040 to 2.15 million, from 984,000 in 2024. There is already strong recognition of the important role senior living will play in the Kingdom’s future, with 84% of Saudis agreeing that dedicated senior living facilities need to be integrated in the country’s real estate development plans.
“There is clear potential for strong uptake in premium, well-located senior living developments catering to higher-income households. Our analysis suggests that home care is a valued healthcare delivery model in Saudi Arabia, with affluent and higher-need households demonstrating the greatest willingness to adopt it. As demand skews towards specialised rehabilitative and diagnostic services, there is an opportunity for healthcare providers and investors to expand premium, on-demand home-care solutions that cater to both convenience and complex medical requirements.”
ABOUT KNIGHT FRANK
Knight Frank LLP is the leading independent global property consultancy.
Headquartered in London, the Knight Frank network has 600+ offices across 50+ territories and more than 20,000 people. The group advises clients ranging from individual owners and buyers to major developers, investors, and corporate tenants. For further information about Knight Frank, please visit www.knightfrank.com.
In the MENA region, Knight Frank has strategically positioned offices in key countries such as the United Arab Emirates, Saudi Arabia, Bahrain, Qatar, and Egypt. For the past 17 years, the firm has offered integrated residential and commercial real estate services, including transactional support, consultancy, and property management. Understanding the unique intricacies of local markets is at the core of Knight Frank’s work, blending this understanding with global resources to provide clients with tailored solutions.
